Essay
John and Jacob are participating in a contest as a team.In the first round of the game,John has to decide whether or not he trusts Jacob.If John trusts Jacob,Jacob can choose to either defect or cooperate.If Jacob defects,Jacob will win $200 while John will gain nothing and if Jacob cooperates,both of them will win $100.However,in case John does not trust Jacob,both will win only $10.What is the payoff to the players in equilibrium? Can the equilibrium of this game be any different and under what circumstances?
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